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4 Types Risks of Crop Insurance

Risks of Crop Insurance Bad weather, floods, droughts, hailstorms, and insect infestations are called crop risks. As grain is produced under the open sky, this risk may arise in different ways in agriculture.

4 Risks of Crop Insurance The risks are discussed:

Natural hazard:

The risk to crops caused by bad weather is called natural hazard. Such risks are never manageable. These are usually caused by adverse natural environments and climates. Natural hazards include: crop rot, spider mites, heavy rains, droughts, floods, hailstorms, storms, thunderstorms, floods, cyclones, etc.

Social hazard:

The risk posed by the people of the society in the production and storage of grain is called social risk. Since grain is produced under the open sky, the amount of social risk in agricultural property is higher than other properties. Social risks; Fire, theft, robbery, embezzlement, staining etc.

Economic hazard:

The financial loss that farmers face due to fluctuations in grain prices. Call it economic risk. It is often seen that commodity prices fluctuate due to market conditions. In that case, when the price of grain goes down, the farmers are deprived of the fair price of grain, even up to the cost of production. As a result farmers suffer financially, which is known as economic risk.

Moral hazard:

When someone intentionally damages a corner of a grain, it is called a moral risk. In many cases, such risks make farmers poor. Such as: moral dishonesty of the farmer or employee, intentional negligence, taking late action to avoid any loss or danger, etc.